Is gasoline on its way to $3 a gallon?

Trader T. Boone Pickens says "Yes,' as oil tops $60 a barrel.

A surge in crude oil prices is fueling speculation that the price of gasoline could soon reach the $3-a-gallon mark.

"We'll see it within a year," hedge fund manager T. Boone Pickens said Saturday on CNN.

Pickens, a 77-year-old Texas oil tycoon, has a vested interest in seeing the price of oil rise. He has wagered, through his $2.5 billion BP Capitol hedge fund, that it would.

In the past few years, his prescient predictions have earned him a fortune, as well as credibility as a market forecaster.

Three-dollar-a-gallon gasoline would have both symbolic and real significance. In addition to being a round number, $3 -- adjusted for inflation -- is approaching what Lehigh Valley residents paid for a gallon of gasoline at the height of the 1970s oil crisis.

The $1.35 that they paid for a gallon of gas in June 1979, for example, is the equivalent of $3.40 today.

Pickens' outlook is rooted in the belief that world oil supply and production is about to peak in the face of rising demand.

Indeed, economic forecasts from both the International Monetary Fund and the Organization for Economic Co-operation and Development call for continued economic expansion on multiple continents.

That is expected to drive demand to an average 84 million barrels a day in 2005. Excess production capacity is estimated to be about 1.5 million barrels a day, most of it controlled by Organization of Petroleum Exporting Countries.

The president of OPEC over the weekend began consultations with fellow members about whether to release another half million barrels into the market, but said the organization would monitor prices before taking action.

Last week, the price of crude oil -- the raw material of gasoline -- rose briefly to $60 a barrel. On Monday, the price closed at more than $60, trading near $61.

Although more than 60 percent higher compared to a year ago, the price of oil would have to surpass $90 a barrel to breach the all-time, inflation-adjusted high set 25 years ago.

On Monday, the average price of regular unleaded at gas stations across the Valley was $2.18 a gallon, according to a survey by AAA. That's a few cents shy of the local record -- $2.21 -- set on April 13.

While attention-grabbing, the price spike isn't life-altering for most people. Gas accounts for 3 percent of consumers' total expenditures, based on calculations for the Consumer Price Index.